Wall Street rallied more than one percent yesterday because a Fed governor said he might not raise rates, which is now what counts as good news.
Good morning and welcome to today's market chronicle. It's Friday, September 4, 2026.
Christopher Waller allowed that if inflation keeps cooling he would be willing to hold, and le tout-Wall Street decided this was a gift. The S&P 500 closed at 7,747.71, up 1.06%, the Nasdaq at 26,584.06, up 1.4%, the Dow up 624 points to 53,686.11, three sessions of losses erased in an afternoon. Odds of a September hike fell from roughly 63% to about 55%. Read that again. The tape threw a party because the probability that the central bank makes money more expensive dropped to a coin flip. Kevin Warsh, chairman since May, spent Jackson Hole pointing out that inflation has run above target for 65 months and that the committee may have work to do, and the market ignored him for a week and then went shopping on the first dovish syllable from a governor. Who actually won here? Whoever was short volatility into the weekend, and only briefly.
And the nicest part of Waller's disinflation case is a pending Commerce Department change to how financial services fees are estimated, which he expects to shave a few tenths off twelve month PCE. He called it a welcome measurement correction. Translation: prices are not falling, the ruler is. Everyone is pretending not to notice, because the alternative is noticing that roughly half of July's core PCE came from imputed prices, the kind nobody actually pays. The wonderful world of finance.
At 8:30 we get August payrolls. Consensus sits somewhere between 50,000 and 58,000, unemployment holding at 4.1%, after July printed minus 23,000 and June and July together managed a net loss of 3,000 jobs. A jobless summer, and the live debate is whether to tighten. A soft number does not buy a cut here, it buys an argument about whether stagflation counts as a mandate problem or a communications one. It will be forgotten by lunch.
The desk closed Meta Platforms ($META) on September 1 at 578.54 against 592.47 entry, minus 2.35% over 20 trading days, while the S&P managed minus 1.24% over the same stretch. Not a stop. Twenty sessions is this desk's maximum hold, the position reached it without hitting its stop, so it came off. The advertising engine was never the thing in question. The cost structure was, and twenty sessions was not enough time for that argument to settle. The rule does not negotiate.
Elsewhere, gold sits around 4,428 an ounce, WTI near 92 with American strikes on Iranian launchers doing the heavy lifting, Bitcoin around 80,000 after a bounce that still leaves it looking like the canary that stopped singing several verses ago, S&P futures flat before the number, and the 10-year at 4.78%, the highest since October 2023. That last one is the entire story and it gets a footnote.
Oil at 92, gold at 4,400, yields at a 19 month high, and the market's great relief this morning is that policy might merely stay where it is. Have a good one.